Cls Share Discussion Threads

[boozey] 05/6/2023 18:39

Massive Director buying in recent times.

[hindsight] 05/6/2023 18:27

Hopefully nickrl

[nickrl] 05/6/2023 17:55

another chunky buy into the family trusts

[nickrl] 30/5/2023 16:41

Its one of the family trusts. Given discount here wonder if family musing a full buyout?

[boozey] 30/5/2023 16:18

Another huge Director purchase.

[spectoacc] 12/5/2023 17:19

There's quite a few threatening to break lows now, several on the third retest. I expect them all to go through, but plenty of upside if you're of the opposite view & they find support here. API another, HLCL a more convincing 3rd (not a holder of those either, but good luck those who are).

[nickrl] 12/5/2023 17:00

CEO stuck is hand in for 46k purchase but should have waited till today as it makes nigh on a 10 year low. I make that 61% below NAV at a 6.2% yield which is currently well covered but debt costs will be creeping up with each refi.

[m_kerr] 24/4/2023 22:23

a major advantage of CLS vs most other REITs is that the properties are mostly held in individual or small portfolio SPVs: '36 SPVs, eight portfolios' with non recourse debt to the holding company. risk is therefore isolated to each SPV, rather than risking taking the group down. LTV is relatively high, but the underlying discount to property value is about 30%, which goes a long way to compensating for the increased risk.

i make it roughly 6% portfolio NIY, which although a bit low, does seem to reflect higher quality assets including EPC, and relatively high government tenancy.

[skyship] 20/4/2023 17:02

Adrift again. 131p! EPRA NAV discount up to 60%.

[skyship] 17/4/2023 15:10

NED and family member buys another 53k @ 135p.

[skyship] 17/4/2023 13:19

Well, I liked the arguments put forward by Inglis in the RGL Presentation; most of which applies here.

Thought long and hard about getting back in there after a very long absence; however in the end decided to go for the other office player - CLI.

The 58% EPRA NAV discount is just too overwhelming. Also fancy the family might be tempted by a PE offer as much as twice the current 137p.

[nickrl] 30/3/2023 11:31

@oxman they are very office heavy so i would expect NTA to continue to drift downwards for a couple more years so discount will close up by a further 10-20% but would still leave them on a wide discount. Their debt costs are creeping up but despite saying a big chuck of 23/24 refi is a done deal they dont disclose specifics on the loans other than to say that investors should expect a 50-60bps outward move from the current low levels so we know interest costs going up. From my analysis they have one of the highest divi covers in the sector from free cash and this IR increase will still leave them above 100%. Conversely the vacancy level in the UK has been creeping up and is already at 10% and their estate whilst a bit better positioned than RGL feels like it will suffer further attrition over next couple of years so scope for rental growth limited. The other side of the coin though is the French and German assets are far better shape and have some reasonable inflation linked leases so all round neutral. With yield hovering around 6% i was tempted but now im not sure if 6% is sufficient in the current mkt albeit i doubt IR will move north of 4.5% i reckon they will be >4 for next 12mths min.

[its the oxman] 30/3/2023 09:59

Bought more here. Discount may persist for a while yet but we will not be in an interest tightening cycle forever.

[nickrl] 25/3/2023 13:53

@shieldbug they also have this remark

"After careful consideration, taking into account the strong performance of the Executive Directors in such a turbulent time and that a significant proportion of TAR related to factors outside their control, the Committee decided not to exercise their discretion and reduce the award due below the formulaic outcome under the PIP Plan rules"

really they need to take the rough with the smooth if they want credibility but basically they are there to protect the family's interest and if you invest you have accept that for getting some of their return. That said doesn't look like the 2020 LTIP will pay out much. Also the awards for 2022 will only be banked if they hit targets which are split 50/50 between two measures.


Total Shareholder Return relative to FTSE 350 Real Estate Super Sector constituents
EPRA NTA growth per share relative to FTSE 350 Real Estate Super Sector constituents

but the targets they need to hit aren't shown in the report.

Anyhow this one features on my watchlist as it easily covers its dividend currently from operating cash and can certainly absorb the creeping interest costs from the various refis they need to do over next 12mths. However, it has fair few speculative developments coming to fruition it hasn't let yet and thats despite them being high quality. The vacancy rate is going up in the UK and they are at least transparent enough to show that they basically lost 50% of the tenants on break/expiry in 2022. Conversely they look in much better shape in Germany and France.

Couldn't quite commit yesterday with the Deutsche Bank issue hanging over the markets but am far more predisposed to them than RGL currently but lets see what they ahve to say next week.

[shieldbug] 25/3/2023 09:38

In fact Skyship the execs are taking a massive haircut -

"Reflecting on the current economic climate and the fall in CLS’ share price
since the grant of the 2022 LTIP, which has the potential to lead to windfall gains,
the Committee has determined that this would not be an appropriate time to increase the LTIP award towards the New Policy maximum of 200% of salary."

Please be sensitive to their feelings when you make such bold comments...

[nickrl] 15/3/2023 21:18

Not the only ones to have such arrangements which i will be clear i dont like either. Anyhow what teh RNS doesn't say is what the targets are that need to be achieved so if the hurdles are high enough that will benefit all shareholders. The issue often is they aren't challenging enough.

[skyship] 15/3/2023 20:55

Jeez - the totally useless and incompetent top execs granted nil cost options at a 57% discount to NAV. A total rip off for shareholders.

I don't hold; but if I did I would certainly kick up a rumpus on corporate governance grounds.

[gary1966] 15/3/2023 16:34

This really is a lifestyle company.

[spectoacc] 08/3/2023 09:12

Interesting how many are planning sales - "nothing to see here". At some point, the buyers will have spent their cash, but for now some things are getting away.

Vacancy rates are key - mostly OK so far, but a chance of triple whammy in future - re-gears at higher rates, dearth of buyers, vacancy rate, EPC spend.

(Quad-whammy doesn't sound as good).

[shieldbug] 08/3/2023 09:12

From the call it seems they are focused on getting LTV below 40%. A lot of refinancing to do this year. It seems like they have a lot of smaller borrowing arrangements, presumably each related to individual properties.

[nickrl] 08/3/2023 09:09

vacancy rate creeping up esp in UK which should worry others, interest charges going up by their own admission, capex c60m again this year but at least they are tackling the EPC D assets but will they get the money back? so lets see if they can get the two quality assets in London ( 1 new 1 refurb to EPC A) leased.

They are also forecasting sales to manage debt levels.

will return later when ive had more time to delve into the report.

[its the oxman] 08/3/2023 08:55

Results seem perfectly ok, but huge discount persists like many property related plays. Waiting game for interest cycle to turn I guess. But more than happy to add at this level.

[nickrl] 04/3/2023 21:56

FY results next Weds will reveal all

[skyship] 04/3/2023 21:12

Back down to support level; will it bounce again:


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